The HOME Kit
Executive Statement:
“The H.O.M.E Kit” is a company that focuses on the inconveniences of moving into a new apartment or house for younger adults (primarily college students). We will focus on supplying the consumer with simple non-perishable goods that are often looked over when making a move. This service will ensure that when the consumer moves into their new living situation all of the small details will be taken care of. Our core goal as a company is to provide ease of mind to the consumer so they can focus on the more important things they need to get for the upcoming school year. EX: books, school supplies, food, furniture etc…Moving into an apartment or house for the first time can be very stressful at times and most college students are likely to miss out on some of the smaller details they forgot until they are finally moved in and go to look for something and it is not there. Recently the popularity of bundles or kits have become more apparent. For example, there are a wide array of services that offer pre made meals for people that find gathering all the ingredients and preparing the meal may take too long for someone with a busy life. We figured we would replicate this type of product but in the form of necessities needed when moving into a new college living situation. Young adults now are seeking the aspect of ease and simplicity so this product will align perfectly with that trend.
Situation Analysis:
H.O.M.E kit product is a bag filled with either cleaning tools or cooking tools. This is a new product in the market produced by our company that was founded in November 2019 in Delaware. The company’s goal is to put the basic essentials needed on moving day into the hands of new movers when they need them the most. The company expects to take advantage of an increasing demand and desire for easy and professionally packed essentials especially for students on their move-in day. Although there are other companies both large and small that compete in this market, our company has the expertise to create and market superior products that will appeal to its target market.
Internal Environment; Mission Statement, Organizational Culture and corporate culture:
H.O.M.E. mission statement is to meet the need and demand of the handiest and easily carried moving day essentials. H.O.M.E. organizational structure comprises of five young entrepreneurs who are its founders. Jack the founder and co-president, chief financial officer, Michael, Hannah sales manager besides Patrick who also advises on product development, Najma maintains the company relationships internally and externally. With innovation and creativity as the core corporate culture. The company’s beginning was based on a desire to provide a kit that includes all the essentials and it’s the company’s decision to consistently emphasize this mission.
Past and Current Marketing; Current products, current market, pricing and distribution:
Our H.O.M.E. kit product is new to the market since we are producing it for the first time, we don’t really have data for any previous products. However, we believe in our company’s production process and we are determined that our product will be a success. H.O.M.E is basically a bag filled with either cleaning tools or cooking tools like cups, plates, pot, pan, grater, cutting boards, utensils, flashlight, towel, dustpan, and spray bottle etc. It could also be a customizable kit where the customer can mix and match tools by themselves. The bag has two sizes, a medium size H.O.M.E kit that can carry 21 products and a large size H.O.M.E kit Plus that can carry additional contents like a mini-vacuum, lightbulbs, batteries, and a toolkit. Each kit comes in a considerable weight that can be easily carried. Also, H.O.M.E label is represented in every kit.
Our company’s current market comprises mainly of college students and other clients in the highly populated areas and in wedding registry items. H.O.M.E. positions itself through competitive price strategies and product differentiation. Our current market comprise anyone who cares about making moving day less stressful. Since H.O.M.E. is launching a new product in the market, it’s not easy to forecast how this product will perform hence the need for a product strategy. Before launching H.O.M.E we had candidates who were willing to participate in our survey about the kit’s idea. The results revealed that half of the candidates usually tend to forget 2-4 important items when moving into a new place. Therefore, this proves to us that our kits would save everyone who wishes to move in the hassle. For pricing, the suggested retail prices after penetration for our products are $60 for H.O.M.E kit and $90 for H.O.M.E kit Plus.
To reach its target market, the company places primary distribution emphasis on college students, couples, and families. H.O.M.E. distribution strategy involves the use of retail stores like Bed Bath & Beyond, Home Goods, and Macy’s. We can start by developing relationships with these companies through individual contacts by company personnel. As well as, making contacts with manufacturers’ agents who are individuals who sell products for a number of different non-competing manufacturers. This could help expand our product in various geographic regions. We also intend to use online orders, deliveries to apartments, use of kit displays on retail stores, and the option of partnering with colleges to order to university apartments and dorms.
External Environment: Economic, Technological, Political, legal and sociocultural Environments:
H.O.M.E faces several different levels of competition. Its direct competitors include companies that also market these kits like Moving Day Survival Kit, moving care package, other smaller manufacturers as well as individuals who make these kits as gifts for their friends and families. Economically, our product is expected to gain momentum and increases its sales steadily. With the continuing improvement of the economy, we hope for more growth opportunities.
Technological advances have had minimal impact on the firm’s operation. Nevertheless, the use of current technology has enabled and enhanced many of our activities i.e. the company uses the internet to enhance its promotional strategies that involves the use of twitter and Instagram Ads, YouTube Ads, and print ads in textbooks. Other promotional strategies include; free shipping, trade shows, roommate deals and summer sales. H.O.M.E is environment friendly. We make sure to provide products that reduce the use of plastics, and ones that can be recycled. We are working hard to provide our clients with products that are safe for their use and for the planet as well. On the other hand, since we are distributing our product nationally at the moment, we are focusing to follow our country-specific regulations and not worry about global markets regulations. As well as, conforming to regulatory guidelines for our product campaigns. H.O.M.E tends to use marketing research to monitor and follow the consumer environment. The research shows that even though the idea of making kits are very popular and familiar to people, there are still students and couples who would rather spend money to get a kit that contains the essentials when moving. Also, the trend towards gifting newlyweds, couples or students a ready move in kit that has everything in it has increased dramatically for the past years. Therefore, you usually find these kits in stores or online more often and people are becoming more aware of that.
SWOT Analysis:
The SWOT analysis provides a summary of the strengths, weaknesses, opportunities, and threats identified by H.O.M.E through the analysis of its internal and external environments.
Strengths:
H.O.M.E. have creative and skilled employees who ensure its products are of high quality and are practical products that provide essentials to movers with customer’s convenience as a top priority. The company also has a strong network with its distributors, agents and manufacturers and enjoys increased reputational growth for its high-quality products. Low cost products, as well as strategic business location helps the company command huge sales and wider market share.
Weaknesses:
Limited financial resources for growth, lack of advertisements funds and other marketing needs have been the company’s main undoing toward low cost production. There is need to ensure H.O.M.E. has access to loans and other financial resources that will better its operations. Opportunities:
Increased trends in customer’s shopping remains the main opportunity for H.O.M.E. The company therefore have good chances to ensure profitability, and its sustainability is assured in terms of availability of customers. As well as, after a successful sale of the product, the company wishes to sign contracts with college bookstores to have the permission to sell H.O.M.E kits.
Threats
Increased competition from companies that market like moving day survival kits and an increase in popularity of moving day kits were identified to be the company’s main threats. The company also faces a threat of bad debt and cash flow issues due to provision of low cost products which need mass production to satisfy demand.
Objectives:
While there are many objectives we hope to accomplish, our main one is to make the H.O.M.E kit the #1 item on every student move in list and make all of our customers as happy as they can be. We (as college students) know how difficult move in day is, it is stressful and you feel like your list just keeps getting longer. We want to do our part and make move in day as easy as it can be and relieve you of all your stress. To make this happen we have created a bundle that checks off many items on a move in list and at the same time saves you money.
The H.O.M.E kit includes kitchen utensils (Plates, Utensils, Cups) as well as every day use items such as a flashlight, towels and a dust pan. This kit will ensure that all the small details are taken care of before moving into your apartment. Since move in day can be especially stressful, we try to take care of all the things that can be easily forgotten or misplaced when moving.
Our starting price is 60$ which is half if not less than other pot and pan bundles which can range from $100 to upwards of $200. With our low pricing we aim to attract many young customers (especially college students) that are struggling with money or do not have a lot to spend on unnecessary items for their apartments/houses. We developed this product based off the needs for college students, and with that in mind, we wanted to create to the cheapest alternative possible.
Lastly, we want to make the ordering process the easiest and most efficient on the market. Our website will be simple and straight to the point, just as we would like your moving experience to be. We have given our customers two standard options to choose from, the H.O.M.E Kit and the H.O.M.E Kit plus. this is convenient for college students instead of having to put multiple things in an online shopping cart or travel to many stores, you can have the H.O.M.E kit shipped to your door in just one click.
Marketing Strategy:
Target Markets and Positioning:
Moving on to the marketing strategy of The H.O.M.E. Kit, several traditional and unique strategies are planned to be put in place. Starting with identifying our target markets, it is clear to us that most of our purchases will come from new apartment or home owners, especially those in college, so college students are our primary target market. We also feel it could be effective to target areas that are urban with high populations as they have young populations and a high amount of apartments, but we will primarily focus on the college student market. Our positioning strategy will naturally focus on separating ourselves from any potential competition. One of the ways we will do this is by implementing a positioning strategy that closely works with our target market. We plan to create an image for the company that will cater to the college students we are targeting, which can be done by having a large social media presence and by making our product well known and seen as an essential purchase for any new apartment owner. We also plan to position ourselves in the market through pricing strategies which we will expand upon shortly. The most effective way we can position ourselves however, is by differentiating ourselves from other brands by offering cheaper and more reliable items. College students are not going to be looking for top quality cooking and cleaning products, and the H.O.M.E. Kit aims to reflect this while still offering durable and reliable items.
Product Strategies:
There are many product strategies in place for the H.O.M.E. Kit. We plan to offer regular and “plus” models to start, with the plus model having larger additional items such as a small vacuum and a toolkit. There is also the opportunity for more models to be offered in the future which could include outdoor themed items or even a travel kit. Another product strategy was mentioned briefly before and that is to have the items in the kit be cheaper alternatives. This would mean utensils would be a strong plastic., the pots and pans will be of cheaper material, and things like the tool kit and vacuum will be smaller alternatives. This caters to our target market of college students who don’t necessarily need the best quality items, rather affordable ones that will “get the job done”. One more product strategy for the H.O.M.E. Kit will be to make sure each item in the kit is non-consumable- our company aims to make sure the kit is something that can be used for a long time so we want to offer items that can be used over and over again. While a kit may be added in the future that changes this, it is important to us that our core product is one that students can benefit from for a long time.
Distribution Strategies:
Distribution strategies are an important part of the H.O.M.E. Kit’s marketing plan. Rather than offer our product from a company owned website, we plan to have it offered in home good stores which include Bed Bath and Beyond, Home Goods, Macys, JCPenney, and the like. These stores already have respected reputations as retailers which offer products for homes and apartments, and or kit will fit in well with what is sold at these stores. Despite not having a personal website, we expect for a large amount of our sales to come from online orders on the websites of our retailers. It will be very helpful for college students to be able to order their H.O.M.E. Kit and receive it at their new apartments or houses rather than transport all the items themselves, and the common deliveries will be a reason our retailers will want to carry the product. In addition to this, we hope to have partnerships with universities themselves and have the schools offer the product to incoming and returning students as part of their room and board plan as many campuses have apartment-style dorms and most of the items could still be helpful in regular dorms. One more part of our distribution strategy will be to have the entire kits on display by the retailers, but to have the actual boxes they come in be plain cardboard, as it would save money and any design on the box would not necessarily increase sales, as it is more important to see the contents in person or in photos than on the actual box.
Pricing Strategies:
Pricing strategies are an important part of the H.O.M.E. Kit’s marketing plan. As briefly mentioned before, our pricing strategy will be integral to starting our business. We plan to use a penetration pricing strategy and to build a reputation for ourselves early on when many people are buying the product at a discounted price. We still plan to keep the price of the H.O.M.E. Kit relatively low after we complete our penetration strategy, as this will appeal to our target market and is in line with the fact that the contents of the kit will be cheaper alternatives. Typical 21 piece cooking kits can range from $80 to $200 dollars on average, and these do not include the additional home items that our kit offers. The cost of goods sold for the regular H.O.M.E. Kit will be about $25. We plan for the price of this product after penetration to be $60, which is well below the average prices mentioned before. This gives our company a profit of $35 per H.O.M.E. Kit sold. As for the H.O.M.E. Kit Plus, cost of goods sold will be around $45. After penetration, pricing will be $90 for this kit which includes everything in the first kit plus a vacuum, toolkit, rechargeable batteries, and lightbulbs. This puts our profit at $45 per H.O.M.E. Kit Plus, purposely more than that of the regular kit.
Promotional Strategies:
The final part of our marketing plan is our promotional strategy. We plan to advertise through YouTube Ads, Instagram Ads, and Twitter Ads. We feel that these three locations will be the most effective in reaching our target market, as a television or billboard ad may be overlooked by the younger generation. We also plan to promote ourselves through the aforementioned potential partnership with universities, who will already have a great outreach to our target market. Similarly, we hope to place ads in SAT, and other test prep books which most college or soon to be in college students will own and look over several times. We also plan to offer promotions which lower the price of the H.O.M.E. Kit and entice consumers. A roommate deal could be effective in which roommates have a choice of getting several H.O.M.E. Kits at a discounted price per kit, or for the roommates to split the price before delivery to share the items. We also plan to offer more discounts in the summer when we expect fro more kits to be bought in order to win over any skeptical consumers. Lastly, we plan to offer free shipping on all orders during “move-in months” to further entice the target market into buying our product. Buzz-building activities are also planned which include a “H.O.M.E.-coming” event when parents are visiting schools and we can set up tables to offer the product to be purchased for their children at discounted prices. We also hope to hire representatives to stand by the product in stores a few times a month to persuade consumers into buying the kit.
Implement & Control the Plan
Action Program:
For our action plan, we needed to figure out the layout of how we can manufacture and distribute our product that will generate the most revenue and draw the attention of college students that are planning on moving to college in the near future and will find The H.O.M.E kit to be the best moving kit to purchase rather than similar competitors. Because most students move into college in the fall, we think that we should start our action plan around the summertime so when fall approaches and most students are planning on moving to college, we can have our product readily available for purchase in large department stores. We hope to be advertised through YouTube Ads, Instagram Ads, and Twitter Ads from July through early September, when going to school is on our target audiences mind. They will see our ad and realize how convenient our kit will be so they do not need to go through multiple retailers with full carts and still possibly forget essentials that many people may tend to look over.
Responsibility:
The founders of the company will be responsible for making sure that the action plan takes place the way it should be. This seems like the ideal strategy as opposed to hiring employees to do it because we have not generated any revenue yet. Once we launch and make a profit and decide to continue manufacturing the H.O.M.E kit, then we may hire employees to take responsibility for more minor operations as our company grows. Because we plan on selling through retailers, we do put some responsibility on the retailers to make sure that our product is being promoted enough and has captured the attention of our target audience.
Timeline:
Our first step of the plan, making initial contact with multiple department stores to discuss selling our product on their online store and displaying the kit in store, will take place March 1st and end July 1st so we have enough time to contact the stores but also will end when we need to start preparing which retailers we want to sell our product through. On June 1st, we plan to prepare and design our social media ads and end on July 1st, so when we are ready to launch the ad we can capture an audience that is thinking about moving to college around that time. We will contact universities to promote the kit starting in July, so we have enough time to secure the universities we are selling from once the fall semester starts. Finally, we will launch our ads on July 31st, just a month before school begins to get students thinking about our product and purchasing it to make the moving process easier.
Budget:
Our budget for one sale of the regular H.O.M.E kit will generate a $60 profit and once subtracted from our cost of goods sold, will give us a profit of $35 on each sale we make. We think that this is a decent amount of profit to make once we compared the cost of goods sold and how much time and effort is needed to make one kit. For the H.O.M.E kit Plus, we budgeted a $45 profit once we subtracted our expense costs of $45 to our sale price of $90.
Measurement and Control:
One of the metrics we used for measurement are time college students spend on Twitter, Instagram and Youtube to see how much coverage our ads will get. Another metric we plan on using is determining Customer Acquisition Cost after buzz building activity to predict how our product will do through larger audiences once they become promoted on large retailer websites. The last metric we plan on measuring is Return On Investment from retailers vs social media to sell which platforms bring the highest return on investment. One of our main focuses of control is ensuring that ad cost does not exceed profit once we launch the kit. We also are focused on controlling the amount of commission we are paying retailers to make sure we are generating a decent profit still and the cost of products used to make the kit and compared to amount of profit from sales. These two measures will make sure we are not wasting profit but are rather investing our money for more promotion to bring about more profit. Once launched, we will determine which retailers we generate the most revenue from and try to obtain distribution agreements to keep a high sales rate through their store.